Waddell & Reed Financial, Inc. Reports Second Quarter Results

Company Release - 7/26/2016 6:45 AM ET

OVERLAND PARK, Kan.--(BUSINESS WIRE)--
Waddell & Reed Financial, Inc. (NYSE: WDR) today reported second quarter
2016 net income1 of $33.7 million, or $0.41 per diluted
share, compared to net income of $37.0 million, or $0.45 per diluted
share, during the prior quarter and net income of $67.4 million, or
$0.80 per diluted share, during the second quarter of 2015. Operating
income was $53.8 million during the current quarter and the operating
margin was 16.8%, compared to $71.4 million and 22.1%, respectively
during the prior quarter and $111.0 million and 28.2%, respectively
during the same quarter in 2015.

The second quarter of 2016 included $24.1 million in charges related to
severance, accelerated amortization of deferred acquisition costs
(“DAC”) and Project E implementation costs. Excluding these charges,
adjusted net income2 was $48.9 million, or $0.59 per diluted
share, while adjusted operating income and the adjusted operating margin
were $77.9 million and 24.4%, respectively. In addition to reporting
results in accordance with generally accepted accounting principles
(“GAAP”), management believes adjusting results to exclude items
provides investors with financial measures that better reflect the
company’s core operating performance and allow for more appropriate
comparisons to prior periods. However, non-GAAP financial measures
should not be considered a substitute for performance measures
calculated in accordance with GAAP. A schedule reconciling non-GAAP
financial measures to GAAP net income and earnings per diluted share is
provided below.

$9.8 million for severance and related charges to compensation and
related costs;

$5.9 million related to the accelerated amortization of DAC to U&D
direct costs (broker-dealer) due to a share class conversion; and

$1.3 million related to costs associated with the implementation of
technology to Project E to U&D indirect costs (broker-dealer).

______________________________________

1 Net income represents net income attributable to Waddell &
Reed Financial, Inc.2 Non-GAAP adjusted results provide
an understanding of our business by excluding the effects of items that
do not reflect the ordinary results of our operations.

Adjusted Results

Reconciliation to GAAP

(Amounts in thousands, except for per share data)

GAAP

Adjusted

2Q 16

Adj.

2Q 16

Operating Revenues:

Investment management fees

$

140,880

$

140,880

Underwriting and distribution fees

146,312

146,312

Shareholder service fees

32,016

32,016

Total operating revenues

319,208

319,208

Operating Expenses:

Underwriting and distribution

181,245

(14,285

)

166,960

Compensation and related costs

58,341

(9,818

)

48,523

General and administrative

19,276

19,276

Subadvisory fees

2,325

2,325

Depreciation

4,260

4,260

Total operating expenses

265,447

(24,103

)

241,344

Operating Income

53,761

(24,103

)

77,864

Investment and other income/(loss)

687

687

Interest expense

(2,776

)

(2,776

)

Income before taxes

51,672

(24,103

)

75,775

Provision for taxes

18,101

8,937

27,038

Net Income

$

33,571

(15,166

)

$

48,737

Noncontrolling interests

(124

)

(124

)

Net Income Attributable to Waddell & Reed Financial, Inc.

$

33,695

(15,166

)

$

48,861

Net income per share, basic and diluted:

0.41

(0.18

)

0.59

Weighted average shares outstanding - basic and diluted

82,947

82,947

82,947

Operating margin

16.8

%

24.4

%

Business Discussion

As of June 30, 2016, assets under management declined 9% sequentially to
$86 billion due mainly to outflows from our Institutional and
unaffiliated distribution channels. Our Institutional channel
experienced three material redemptions during the quarter that accounted
for $4.9 billion of the $5.5 billion in total outflows. Our unaffiliated
distribution channel experienced $3.9 billion in outflows of which the
Asset Strategy funds accounted for $2.6 billion.

“The company is not without challenges,” said Philip J. Sanders, Chief
Investment Officer and incoming Chief Executive Officer of Waddell &
Reed Financial, Inc. “Our top priorities are improving investment
performance, reigniting sales and executing on our technology
initiatives across the company.” Henry J. Herrmann, Chairman and Chief
Executive Officer added; “we have a strong executive team that is united
in its focus on achieving these objectives and I am confident that Phil
is the right person to lead the organization through these difficult
times.”

Management Fee Revenue Analysis

Management fees declined 3% sequentially, while average assets under
management declined 5%. Fees declined at a lesser rate than average
assets under management due to an improvement in the effective fee rate
due to a mix-shift in the asset base that increased the average fee
rate. Compared to the same quarter last year, management fees declined
24% due to a 26% decline in average assets under management, which was
partly offset by a mix-shift in the asset base that increased the
average fee rate.

Average assets under management were $90.8 billion during the current
quarter, compared to $95.7 billion during the prior quarter and $123.5
billion during the second quarter of 2015. The effective fee rate for
the current quarter was 62.4 basis points compared to 60.8 basis points
and 60.4 basis points during the first quarter of 2016 and second
quarter of 2015, respectively.

Underwriting and Distribution Analysis

Underwriting and Distribution Revenues

Revenues were largely unchanged sequentially as lower sales and, to a
lesser extent, lower asset levels in our retail unaffiliated channel
were offset by higher advisory fee revenues in our broker-dealer
channel. Compared to the same period last year, revenues declined 15%
due to lower asset-based Rule 12b-1 service and distribution fees across
both channels driven by a decrease in average assets under management.

Underwriting and Distribution Costs

The current quarter included charges for severance, accelerated
amortization of DAC and costs associated with the implementation of
Project E. These charges totaled $5.9 million in direct expenses and
$8.4 million in indirect expenses.

Compared to the second quarter of 2015, direct costs declined 14%;
however, excluding the above referenced items, adjusted costs declined
18% due to a decrease in assets under management and lower sales volume.
Indirect costs increased 17%; however, excluding the above referenced
items, adjusted costs declined 2% due to lower advertising and sales
meeting costs.

Compensation and Related Expense Analysis

Costs increased 10% compared to both the first quarter of 2016 and
second quarter of 2015. The current quarter included severance charges
that totaled $9.8 million. Excluding these charges, adjusted costs
declined 8% compared to both the first quarter of 2016 and second
quarter of 2015. The decline was due to lower base salary and payroll
taxes from the reduction in workforce and certain employees having
exceeded the social security wage base for 2016.

General and Administrative Expense Analysis

Costs were largely unchanged sequentially as lower dealer servicing
costs were offset by higher IT costs. Compared to the same period last
year, costs declined 31% due in lower dealer servicing costs and IT
costs, and to a lesser degree, a decline in advertising costs.

Investment and Other Income

During the first quarter of 2016, we entered into a number of total
return swap contracts to serve as an economic hedge against the market
risk associated with our investments in sponsored funds. We experienced
a $9.6 million investment loss during the first quarter prior to our
hedging strategy being fully implemented. During the current quarter,
higher dividend income and gains on redemptions of investments
classified as available for sale were largely offset by net losses
experienced from our hedged investment portfolio.

Unaudited Consolidated Statement of Income

(Amounts in thousands, except for per share data)

2015

2016

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

Operating Revenues:

Investment management fees

$

182,105

$

185,914

$

175,218

$

166,325

$

144,778

$

140,880

Underwriting and distribution fees

166,978

171,508

165,130

160,382

146,658

146,312

Shareholder service fees

36,375

36,568

35,761

34,367

32,380

32,016

Total operating revenues

385,458

393,990

376,109

361,074

323,816

319,208

Operating Expenses:

Underwriting and distribution

195,420

195,762

189,065

189,534

173,836

181,245

Compensation and related costs

53,495

52,829

46,157

48,271

52,940

58,341

General and administrative

25,678

27,897

25,458

26,033

19,152

19,276

Subadvisory fees

2,387

2,394

2,305

2,048

2,093

2,325

Depreciation

4,034

4,064

4,117

3,831

4,362

4,260

Total operating expenses

281,014

282,946

267,102

269,717

252,383

265,447

Operating Income

104,444

111,044

109,007

91,357

71,433

53,761

Investment and other income/(loss)

3,972

9

(16,872

)

7,647

(10,218

)

687

Interest expense

(2,766

)

(2,765

)

(2,765

)

(2,772

)

(2,768

)

(2,776

)

Income before taxes

105,650

108,288

89,370

96,232

58,447

51,672

Provision for taxes

38,537

40,843

41,312

33,312

20,978

18,101

Net Income

$

67,113

$

67,445

$

48,058

$

62,920

$

37,469

$

33,571

Noncontrolling interests

-

-

-

-

501

(124

)

Net Income Attributable to Waddell & Reed Financial, Inc.

$

67,113

$

67,445

$

48,058

$

62,920

$

36,968

$

33,695

Net income per share, basic and diluted:

0.80

0.80

0.58

0.76

0.45

0.41

Weighted average shares outstanding - basic and diluted

83,581

84,079

83,469

82,873

82,104

82,947

Operating margin

27.1

%

28.2

%

29.0

%

25.3

%

22.1

%

16.8

%

Net Distribution Cost Analysis

(Amounts in thousands)

Retail Unaffiliated Distribution1

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

U&D Revenues

$

52,142

$

51,768

$

47,040

$

43,091

$

35,923

$

32,510

U&D Expenses - Direct

(68,595

)

(66,947

)

(62,117

)

(57,119

)

(46,846

)

(42,452

)

U&D Expenses - Indirect

(14,029

)

(13,972

)

(13,329

)

(14,614

)

(13,349

)

(14,939

)

Net Distribution (Costs)

($30,482

)

($29,151

)

($28,406

)

($28,642

)

($24,272

)

($24,881

)

Retail Broker-Dealer2

U&D Revenues

$

114,836

$

119,740

$

118,090

$

117,291

$

110,735

$

113,802

U&D Expenses - Direct

(82,022

)

(85,177

)

(84,420

)

(83,413

)

(80,277

)

(87,740

)

U&D Expenses - Indirect

(30,774

)

(29,666

)

(29,199

)

(34,388

)

(33,364

)

(36,114

)

Net Distribution Excess/(Costs)

$

2,040

$

4,897

$

4,471

($510

)

($2,906

)

($10,052

)

1 Retail Unaffiliated Distribution was previously
referred to as the "Wholesale channel"

2 Retail Broker-Dealer was previously referred to as the
"Advisors channel"

Changes in Assets Under Management

2015

2016

(Amounts in millions)

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

Retail Unaffiliated Distribution

Beginning assets

$

60,335

$

59,412

$

57,545

$

49,320

$

45,641

$

38,623

Sales*

3,870

3,239

2,768

2,341

2,144

1,526

Redemptions

(6,259

)

(4,558

)

(5,569

)

(7,300

)

(7,680

)

(5,543

)

Net Exchanges

224

144

265

176

158

127

Net flows

(2,165

)

(1,175

)

(2,536

)

(4,783

)

(5,378

)

(3,890

)

Market action

1,242

(692

)

(5,689

)

1,104

(1,640

)

464

Ending assets

$

59,412

$

57,545

$

49,320

$

45,641

$

38,623

$

35,197

Retail Broker-Dealer

Beginning assets

$

45,517

$

46,385

$

45,947

$

42,215

$

43,344

$

42,142

Sales*

1,270

1,347

1,238

1,218

1,068

1,094

Redemptions

(1,279

)

(1,279

)

(1,242

)

(1,245

)

(1,197

)

(1,329

)

Net Exchanges

(224

)

(144

)

(265

)

(176

)

(172

)

(163

)

Net flows

(233

)

(76

)

(269

)

(203

)

(301

)

(398

)

Market action

1,101

(362

)

(3,463

)

1,332

(901

)

517

Ending assets

$

46,385

$

45,947

$

42,215

$

43,344

$

42,142

$

42,261

Institutional

Beginning assets

$

17,798

$

17,097

$

17,214

$

14,657

$

15,414

$

14,426

Sales*

300

1,203

465

773

453

190

Redemptions

(1,460

)

(1,003

)

(1,817

)

(799

)

(1,068

)

(5,699

)

Net Exchanges

-

-

-

-

14

36

Net flows

(1,160

)

200

(1,352

)

(26

)

(601

)

(5,473

)

Market action

459

(83

)

(1,205

)

783

(387

)

40

Ending assets

$

17,097

$

17,214

$

14,657

$

15,414

$

14,426

$

8,993

Consolidated Total

Beginning assets

$

123,650

$

122,894

$

120,706

$

106,192

$

104,399

$

95,191

Sales*

5,440

5,789

4,471

4,332

3,665

2,810

Redemptions

(8,998

)

(6,840

)

(8,628

)

(9,344

)

(9,945

)

(12,571

)

Net Exchanges

-

-

-

-

-

-

Net flows

(3,558

)

(1,051

)

(4,157

)

(5,012

)

(6,280

)

(9,761

)

Market action

2,802

(1,137

)

(10,357

)

3,219

(2,928

)

1,021

Ending assets

$

122,894

$

120,706

$

106,192

$

104,399

$

95,191

$

86,451

* Sales is primarily gross sales (net of sales commissions). This
amount also includes

net reinvested dividends & capital gains and investment income.

Supplemental Information

Asset Manager

2015

2016

($ in millions)

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

Retail Unaffiliated Distribution

AUM

$

59,412

$

57,545

$

49,320

$

45,641

$

38,623

$

35,197

Net flows

$

(2,165

)

$

(1,175

)

$

(2,536

)

$

(4,783

)

$

(5,378

)

$

(3,890

)

Organic growth

-14.4

%

-7.9

%

-17.6

%

-38.8

%

-47.1

%

-40.3

%

Redemption Rate

42.9

%

31.0

%

41.2

%

59.3

%

77.7

%

61.3

%

Retail Broker-Dealer

AUM

$

46,385

$

45,947

$

42,215

$

43,344

$

42,142

$

42,261

Net flows

$

(233

)

$

(76

)

$

(269

)

$

(203

)

$

(301

)

$

(398

)

Organic growth

-2.0

%

-0.7

%

-2.3

%

-1.9

%

-2.8

%

-3.8

%

Redemption Rate

9.0

%

9.0

%

8.9

%

9.3

%

9.3

%

10.5

%

Institutional

AUM

$

17,097

$

17,214

$

14,657

$

15,414

$

14,426

$

8,993

Net flows

$

(1,160

)

$

200

$

(1,352

)

$

(26

)

$

(601

)

$

(5,473

)

Organic growth

-26.1

%

4.7

%

-31.4

%

-0.7

%

-15.6

%

-151.8

%

Redemption Rate

33.7

%

23.2

%

45.4

%

20.5

%

29.9

%

198.9

%

Fund Rankings

1 Year

3 Years

5 Years

Lipper

Funds ranked in top half

31%

42%

41%

Assets ranked in top half

16%

32%

42%

MorningStar

Funds with 4/5 stars

17%

11%

8%

Assets with 4/5 stars

15%

5%

4%

2015

2016

Broker-Dealer

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

1st Qtr.

2nd Qtr.

3rd Qtr.

4th Qtr.

AUA* (in billions)

$

53.7

$

53.6

$

49.4

$

51.0

$

49.9

$

50.5

AUA* fee based accounts (in billions)

$

18.0

$

18.3

$

17.0

$

17.6

$

17.4

$

17.8

# Advisors

1,745

1,780

1,795

1,819

1,803

1,799

Advisor productivity (in thousands)

$

65.9

$

67.9

$

66.3

$

64.9

$

61.3

$

63.1

U&D revenues (in thousands)

$

114,836

$

119,740

$

118,090

$

117,291

$

110,735

$

113,802

* AUA represent Assets Under Administration

Unaudited Balance Sheet Information

Schedule of Selected Items

Jun. 30, 2016

(Amounts in millions)

Cash & cash equivalents (unrestricted)

$467.5

Investment securities

361.6

Total assets

1,406.2

Long-term debt

189.5

Total liabilities

577.8

Redeemable noncontrolling interests

10.9

Stockholders' equity

817.5

Shares outstanding

82.9

million shares

Quarter ended

Year-to-Date

Jun. 30, 2016

Jun. 30, 2016

($ in thousands)

Shares repurchased

Number of shares

1,075,826

2,201,497

Total cost

$21,863

$47,461

Dividend paid

Rate per share

$0.46

$0.92

Total paid

$38,501

$76,616

Capital returned to stockholders

$60,364

$124,077

In April 2016, we granted 2,213,850 shares of restricted stock

pursuant to our stock incentive plan.

Unaudited Consolidated Statement of Income

(Amounts in thousands, except for per share data)

Six Months Ended

Jun-15

Jun-16

% Change

Operating Revenues:

Investment management fees

$

368,019

$

285,658

-22.4

%

Underwriting and distribution fees

338,486

292,970

-13.4

%

Shareholder service fees

72,943

64,396

-11.7

%

Total operating revenues

779,448

643,024

-17.5

%

Operating Expenses:

Underwriting and distribution

391,182

355,081

-9.2

%

Compensation and related costs

106,324

111,281

4.7

%

General and administrative

53,575

38,428

-28.3

%

Subadvisory fees

4,781

4,418

-7.6

%

Depreciation

8,098

8,622

6.5

%

Total operating expenses

563,960

517,830

-8.2

%

Operating Income

215,488

125,194

-41.9

%

Investment and other income

3,981

(9,531

)

-339.4

%

Interest expense

(5,531

)

(5,544

)

0.2

%

Income before taxes

213,938

110,119

-48.5

%

Provision for taxes

79,380

39,079

-50.8

%

Net Income

$

134,558

$

71,040

-47.2

%

Noncontrolling interests

-

377

N/A

Net Income Attributable to Waddell & Reed Financial, Inc.

$

134,558

$

70,663

-47.5

%

Net income per share, basic and diluted

1.61

0.86

-46.7

%

Weighted average shares outstanding - basic and diluted

83,831

82,526

Operating margin

27.6

%

19.5

%

Net Distribution Cost Analysis

(Amounts in thousands)

Six Months Ended

Retail Unaffiliated Distribution1

Jun-15

Jun-16

% Change

U&D Revenues

$

103,910

$

68,433

-34.1

%

U&D Expenses - Direct

(135,542

)

(89,298

)

-34.1

%

U&D Expenses - Indirect

(28,001

)

(28,288

)

1.0

%

Net Distribution (Costs)

($59,633

)

($49,153

)

-17.6

%

Retail Broker-Dealer2

U&D Revenues

$

234,576

$

224,537

-4.3

%

U&D Expenses - Direct

(167,199

)

(168,017

)

0.5

%

U&D Expenses - Indirect

(60,440

)

(69,478

)

15.0

%

Net Distribution Excess/(Costs)

$

6,937

($12,958

)

-286.8

%

1 Retail Unaffiliated Distribution was previously
referred to as the "Wholesale channel"

2 Retail Broker-Dealer was previously referred to as the
"Advisors channel"

Changes in Assets Under Management

Six Months Ended

(Amounts in millions)

Jun-15

Jun-16

% Change

Retail Unaffiliated Distribution

Beginning assets

$

60,335

$

45,641

-24.4

%

Sales*

7,110

3,671

-48.4

%

Redemptions

(10,816

)

(13,224

)

22.3

%

Net Exchanges

367

285

N/M

Net flows

(3,339

)

(9,268

)

177.6

%

Market action

549

(1,176

)

-314.2

%

Ending assets

$

57,545

$

35,197

-38.8

%

Retail Broker-Dealer

Beginning assets

$

45,517

$

43,344

-4.8

%

Sales*

2,616

2,161

-17.4

%

Redemptions

(2,558

)

(2,525

)

-1.3

%

Net Exchanges

(367

)

(335

)

N/M

Net flows

(309

)

(699

)

126.2

%

Market action

739

(384

)

-152.0

%

Ending assets

$

45,947

$

42,261

-8.0

%

Institutional Channel

Beginning assets

$

17,798

$

15,414

-13.4

%

Sales*

1,504

643

-57.2

%

Redemptions

(2,464

)

(6,767

)

174.6

%

Net Exchanges

0

50

N/M

Net flows

(960

)

(6,074

)

532.7

%

Market action

376

(347

)

-192.3

%

Ending assets

$

17,214

$

8,993

-47.8

%

Consolidated Total

Beginning assets

$

123,650

$

104,399

-15.6

%

Sales*

11,230

6,475

-42.3

%

Redemptions

(15,838

)

(22,516

)

42.2

%

Net Exchanges

-

-

N/M

Net flows

(4,608

)

(16,041

)

248.1

%

Market action

1,664

(1,907

)

-214.6

%

Ending assets

$

120,706

$

86,451

-28.4

%

* Sales is primarily gross sales (net of sales commissions). This
amount also includes

net reinvested dividends & capital gains and investment income.

Earnings Conference Call

Stockholders, members of the investment community and the general public
are invited to listen to a live Web cast of our earnings release
conference call today at 9:00 a.m. Eastern. During this call, Henry J.
Herrmann, Chairman and CEO, will review our quarterly results. Live
access to the teleconference will be available on the “Investor
Relations” section of our Web site at www.waddell.com.
A Web cast replay will be made available shortly after the conclusion of
the call and accessible for seven days.

Web Site Resources

We invite you to visit the Investor Relations section of our Web site at www.waddell.com.
Under the “Investor Info” tab you will find a link to presentations as
well as to data tables which include supplemental information schedules.

This press release contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, which
reflect the current views and assumptions of management with respect to
future events regarding our business and industry in general. These
forward-looking statements include all statements, other than statements
of historical fact, regarding our financial position, business strategy
and other plans and objectives for future operations, including
statements with respect to revenues and earnings, the amount and
composition of assets under management, distribution sources, expense
levels, redemption rates and the financial markets and other conditions.
These statements are generally identified by the use of such words as
"may," "could," "should," "would," "believe," "anticipate," "forecast,"
"estimate," "expect," "intend," "plan," "project," "outlook," "will,"
"potential" and similar statements of a future or forward-looking
nature. Readers are cautioned that any forward-looking information
provided by us or on our behalf is not a guarantee of future
performance. Actual results may differ materially from those contained
in these forward-looking statements as a result of various factors,
including but not limited to those discussed below. If one or more
events related to these or other risks, contingencies or uncertainties
materialize, or if our underlying assumptions prove to be incorrect,
actual results may differ materially from those forecasted or expected.
Certain important factors that could cause actual results to differ
materially from our expectations are disclosed in the "Risk Factors"
section of our Annual Report on Form 10-K for the year ended December
31, 2015, which include, without limitation:

The loss of existing distribution channels or inability to access
new distribution channels;

A reduction in assets under our management on short notice, through
increased redemptions in our distribution channels or our Funds,
particularly those Funds with a high concentration of assets, or
investors terminating their relationship with us or shifting their
funds to other types of accounts with different rate structures;

The adverse ruling or resolution of any litigation, regulatory
investigations and proceedings, or securities arbitrations by a
federal or state court or regulatory body;

The introduction of legislative or regulatory proposals or judicial
rulings that change the independent contractor classification of our
financial advisors at the federal or state level for employment tax or
other employee benefit purposes;

A decline in the securities markets or in the relative investment
performance of our Funds and other investment portfolios and products
as compared to competing funds;

The ability of mutual fund and other investors to redeem their
investments without prior notice or on short notice;

Our inability to reduce expenses rapidly enough to align with
declines in our revenues, the level of our assets under management or
our business environment.

Non-compliance with applicable laws or regulations and changes in
current legal, regulatory, accounting, tax or compliance requirements
or governmental policies;

A failure in, or breach of, our operational or security systems or
our technology infrastructure, or those of third parties on which we
rely; and

Our inability to implement new information technology and systems,
or our inability to complete such implementation in a timely or cost
effective manner.

The foregoing factors should not be construed as exhaustive and
should be read together with other cautionary statements included in
this and other reports and filings we make with the Securities and
Exchange Commission, including the information in Item 1 "Business" and
Item 1A "Risk Factors" of Part I and Item 7 "Management's Discussion and
Analysis of Financial Condition and Results of Operations" of Part II to
our Annual Report on Form 10-K for the year ended December 31, 2015 and
as updated in our quarterly reports on Form 10-Q for the year ending
December 31, 2016. All forward-looking statements speak only as of the
date on which they are made and we undertake no duty to update or revise
any forward-looking statements, whether as a result of new information,
future events or otherwise, except to the extent required by law.

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